Introduction

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About This Report

About This Report

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Resources

Walmart has reported on a wide range of ESG topics since 2005.

Our reporting is guided by frameworks such as the Global Reporting Initiative (GRI) Standards, the United Nations (U.N.) Sustainable Development Goals (SDGs), the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-related Financial Disclosures (TCFD). We also participate in external programs such as CDP, a global environmental disclosure system.

This report covers Walmart’s activities for the fiscal year ended January 31, 2020 (FY2020), unless otherwise noted. Calendar years (CY) are marked as such or written in a four-digit format. “Walmart” means Walmart Inc., a Delaware corporation and its consolidated subsidiaries, but except for financial data, otherwise excludes all acquired eCommerce subsidiaries, businesses, platforms and/or marketplaces, unless otherwise noted. This report also covers some activities of the Walmart Foundation, a separately incorporated Delaware charitable private foundation.

We did not seek, nor was there, external assurance from third parties with respect to most of the information in this report; exceptions are noted.

Forward-looking statement

ICM INVESTOR RELATIONS

This report contains certain forward-looking statements based on Walmart management’s current assumptions and expectations, including statements regarding our ESG targets, goals, commitments and programs and other business plans, initiatives and objectives. These statements are typically accompanied by the words “aim,” “hope,” “believe,” “estimate,” “plan,” “aspire” or similar words. All such statements are intended to enjoy the protection of the safe harbor for forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Our actual future results, including the achievement of our targets, goals or commitments, could differ materially from our projected results as the result of changes in circumstances, assumptions not being realized, or other risks, uncertainties and factors. Such risks, uncertainties and factors include the risk factors discussed in Item 1A of our most recent Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission (“SEC”), as well as, with respect to our ESG targets, goals, and commitments outlined in this report or elsewhere, the challenges and assumptions identified in this report under the heading Challenges to achieving aspirational goals, commitments & targets and other assumptions, risks, uncertainties and factors identified in this report. We urge you to consider all of the risks, uncertainties and factors identified above or discussed in such reports carefully in evaluating the forward-looking statements in this report. Walmart cannot assure you that the results reflected or implied by any forward-looking statement will be realized or, even if substantially realized, that those results will have the forecasted or expected consequences and effects. The forward‑looking statements in this report are made as of the date of this report, unless otherwise indicated, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances.

Walmart has reported on a wide range of ESG topics since 2005


Note on materiality

Materiality, as used in this report, and sometimes referenced as “ESG materiality,” and our materiality review process, is different than the definition used in the context of filings with the SEC. Issues deemed material for purposes of this report and for purposes of determining our ESG strategies may not be considered material for SEC reporting purposes.

Corporate Purpose

  • WM_B_0001.jpg
    $524 billion
    FY2020 total revenue (+1.9% vs. FY2019)
  • Walmart Supercenter store #1560 in Springdale, Arkansas.  Photography for ICM on January 29, 2020.
    $25 billion
    operating cash flow
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    +0.4%
    adjusted EPS1
  • Walmart.com.jpeg
    ~37%
    Walmart US eCommerce sales growth
  • ICM INVESTOR RELATIONS
    AA
    credit rating2
  • Walmart’s corporate purpose

    Walmart’s purpose is to save people money and help them live better. We provide convenient access to high-quality, affordable food and other essential products and services to millions of people each week. In doing so, we aim to create shared value for our stakeholders.

    Our business

    • Busy families: budget-sensitive and time-sensitive
    • Omni-channel: stores and clubs combined seamlessly with eCommerce
    • Segments: Walmart U.S., Sam’s Club and Walmart International (consisting of operations in Canada, China, India, Mexico, the United Kingdom and 21 other countries)
    • Retail categories: grocery (fresh, frozen, dry), consumables, pharmacy, optical and general merchandise
    • B2C services: including health and wellness and financial services
    • B2B services: including advertising and logistics
    • Helping people around the world save money and live better

      Our values

      Respect for the individual

      Service to the customer

      Strive for excellence

      Act with integrity

    Walmart Supercenter store #1560 in Springdale, Arkansas.  Photography for ICM on January 29, 2020.

    Stakeholders served

  • ICM INVESTOR RELATIONS
    >265 million
    customers served each week
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    ~11,500 stores
    in communities in
    27 countries
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    >2.2 million
    associates globally
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    ~31%
    institutional ownership representing
    millions of individual investors
  • distribution-center_130150235853686194.jpg
    >100,000
    suppliers
  • Our ecosystem as of the end of FY2020

    *Walmart partnership or joint venture

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    Omni-channel transformation

    We are transforming our company to provide customers with a seamless omni-channel experience in stores and online. To succeed, we are focused on making every day easier for busy families, operating sustainably and with discipline, transforming how we work to embrace digital technology and approaches, and earning the trust of our stakeholders.


    Walmart's plan to win by accelerating innovation

    Make every day easier for busy families

    Develop our associates, sharpen our culture & become digital

    Operate sustainably & with discipline

    Make trust a competitive advantage

    People-led tech-empowered company

    Price and value

    Our people and culture
    • Values-based
    • Opportunity-oriented
    • Inclusive
    • Performance-driven

    Strong, efficient growth

    Customer experience

    Mutually reinforcing business(es)

    Assortment

    Digital
    • Product mindset
    • Data-driven decisions
    • Consumer-grade
    • Modern workspace

    Consistent operating discipline

    Customer safety

    Agile, problem solving culture

    Experience

    Strategic capital allocation

    Customer values

    Focus on responsible use of technology

    Key enablers

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      Our people
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      Low cost structure
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      Technology, data and analytics
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      Sustainable sourcing and operations
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      Supply chain design and innovation
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      Ecosystem thinking and partnerships

    Creating shared value

    We believe we maximize value for shareholders by serving all stakeholders: delivering value to our customers, creating economic opportunity for associates and suppliers, strengthening local communities, and enhancing the environmental and social sustainability of our business and product supply chains.


    Customers

    Associates

    Communities

    Shareholders

    Suppliers

    Planet

    Convenient access to affordable food
    and other essential products and services

    Opportunity for good jobs and advancement

    Resources to build stronger, more inclusive communities

    Superior long-term returns through
    financial and ESG leadership

    Access to markets, growth opportunities
    and ability to accelerate supply chain
    sustainability

    Leadership on renewable energy, waste and sustainability

    >265M
    customers served per week

    >2.2M
    associates globally

    ~11.5K
    stores in communities in 27 countries

    ~31%
    institutional ownership representing millions of individual investors

    >100K
    suppliers

    'A List'
    placement from CDP for climate action

    >6,100
    pickup and delivery locations globally

    >1.1M
    associate trainings in Walmart Academies in FY2020

    $1.4B
    cash and in-kind donations to communities

    $11.8B
    returned to shareholders through dividends and share repurchases

    >$34.4B
    spent with women-owned businesses in the past eight years

    >1.4M
    acres conserved by Acres for America program

    75% of U.S. population
    has access to NextDay Delivery

    Live Better U
    debt-free college degree program for $1 per day

    >630K
    hours volunteered by U.S. associates in FY2020

    22
    consecutive quarters of growth for Walmart U.S.

    80K
    smallholder farmers in India supported by Walmart Foundation

    230 million metric tons (MMT)
    of avoided emissions (CO2e) reported by suppliers since 20173

    Walmart Health
    first two Walmart Health Clinics in Georgia

    100 score
    from the Human Rights Campaign Corporate Equality Index

    >585M
    pounds of food donated in the U.S. alone during FY2020

    +22%
    stock appreciation in FY2020

    >50K
    Indian small businesses to be trained by Walmart Vriddhi

    Our approach to ESG

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    Business exists to serve society

    Our approach to ESG: Generating value for stakeholders

    In 2019, Business Roundtable (BRT) in the U.S. (which our CEO, Doug McMillon, now chairs) issued a Statement on the Purpose of a Corporation , reinforcing the fundamental commitment of member companies to operate for the benefit of all stakeholders.

    The BRT statement aligns with Walmart’s principle of shared value. We maximize value for shareholders by serving all stakeholders: delivering affordable food and other essential products and services to customers, providing good jobs and development opportunities for our associates, providing market access and growth opportunities to suppliers, strengthening the communities where we live and operate and leading on climate, waste and other sustainability issues affecting the planet.

    Good environmental, social and governance (ESG) practices go hand in hand with financial value creation by enhancing customer trust, securing future supply, catalyzing new product lines, increasing productivity and reducing costs.

    In other words, business exists to serve society: business strengthens society, and at the same time serving society strengthens business.

    Salient issues

    Walmart prioritizes ESG issues based on relevance to our company’s purpose, our customers and other stakeholders as well as Walmart’s ability to effect change with respect to those issues. As set out in this report, the most salient ESG issues for Walmart include economic opportunity for our associates, environmental and social sustainability of product supply chains, and climate change, as well as topics like supporting communities (including response to disasters) and maintaining good governance.

    Aiming to transform systems

    To maximize shared value, we aim to deliver a customer-centric, omni-channel experience while impacting the systems relevant to our business, such as food supply chains and retail workforce development. We aspire to reshape such systems for sustainability in terms of social, environmental and economic outcomes. This report provides examples of how Walmart teams collaborate with suppliers, non-governmental organizations (NGOs), government agencies and others in collective action in an effort to transform systems: for example, accelerating the transition to renewable energy to lower greenhouse gas (GHG) emissions, changing worker recruitment practices in southeast Asia to help eradicate forced labor and encouraging workforce development innovations to upskill and advance frontline workers.

    Business integration

    We seek to bring about positive change in society first and foremost by managing our business in a way that creates shared value. That’s why we work to integrate ESG aspirations and initiatives into our business — involving our planning and performance management processes, role descriptions, operating policies and procedures, systems and tools. For example, our Real Estate teams advance our renewable energy objectives. Our Operators and People teams shape our associate proposition, including upskilling and advancement strategies.

    Scaling impact

    Walmart’s reach and capabilities enable us to help scale environmental impact. For example, through Project Gigaton, we have engaged thousands of suppliers as well as leading environmental NGOs such as World Wildlife Fund (WWF) and Environmental Defense Fund (EDF) toward our goal to reduce or avoid emissions in our supply chain by 1 gigaton by 2030. Through projects ranging from factory energy efficiency to fertilizer optimization, to date suppliers report having avoided over 230 MMT of emissions.3

    Aligned philanthropy

    The transformation of complex systems requires collaboration among the public sector, private sector and civil society. Through philanthropy, we seek to complement and go beyond Walmart business initiatives in addressing social and environmental challenges. In FY2020, through a combination of in-kind and cash gifts, Walmart gave more than $1.4 billion to fund projects that create opportunity, enhance sustainability and strengthen communities.

    In FY2020, through a combination of in‑kind and cash gifts, Walmart gave more than $1.4 billion to fund projects that create opportunity, enhance sustainability and strengthen communities

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    ESG Priorites, Goals & Targets

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    Resources

    Defining our ESG priorities, goals & targets

    We prioritize ESG issues that offer the greatest potential to create shared value. They are issues that rank high in terms of relevance to our business and stakeholders as well as Walmart’s ability to make a difference.

    We performed our first ESG materiality assessment in 2014, heavily engaging our stakeholders. The results informed our ESG agenda and 2025 goals related to associate opportunity, environmental and social challenges in supply chains and community resilience. We conduct regular updates through ongoing engagement and dialogue with our stakeholders, which have led to additional initiatives and priorities such as the publication of our Human Rights Statement and the development of science-based targets for emissions reduction. Read more in the Stakeholder engagement section of this report.

    This report provides information on key ESG metrics and initiatives. Below we provide a snapshot of a handful of the most relevant ESG issues:

    1. Economic opportunity for Walmart associates
    2. Environmental and social issues in our supply chains
    3. Climate change

    Economic opportunity

    The retail sector — as a foundational entry point to work and a place to gain valuable skills — provides a gateway to upward mobility. Walmart provides jobs for nearly 1.5 million people in the U.S. and more than 2.2 million worldwide. Our workforce development approach in the U.S. focuses on access, stability and mobility. This approach is designed to lead people from entry to opportunity while addressing workforce development challenges.

    Through competitive wages, predictable and flexible scheduling (with more than 60% of our U.S. hourly associates full time — excluding Home Office associates), and relevant benefits (including quarterly bonuses, paid time off and access to affordable, innovative health care), we empower associates to achieve economic stability. We provide opportunities for them to advance at our company through on‑the‑job training and coaching and by connecting them with affordable education opportunities that can help them succeed within Walmart or beyond. As described in more detail later in this report, our efforts are underpinned by a commitment to fostering workforce diversity and a culture of inclusion. Developing a more diverse and dynamic workforce helps us to keep pace with evolving customer demands while advancing economic inclusion.

    Read more in the Retail opportunity section of this report.

    Environmental & social issues in our supply chain

    Addressing the intensifying challenges of climate change, depletion of natural resources, waste and inequality in society requires increased effort from all sectors. The world’s product supply chains are complex, with highly interdependent social, economic and environmental issues and millions of participants, including customers, suppliers, workers, governments and NGOs. No one business, even at the scale of Walmart, can make significant progress on the sustainability of product supply chains alone; progress depends on the collective action of many. We aim to be part of the solution — collaborating with suppliers and many others to transform supply chains for the better by working together.

    As a first step, Walmart sets expectations for our suppliers through our Standards for Suppliers (consistent with our respect for human rights; read more about our Human Rights Statement and approach ) and uses audits to help assess whether our standards are being upheld. We also evaluate our product supply chains using internal and external data, assessments of particular regions, countries, commodities or products, and guidance from industry experts, NGOs and other stakeholders.

    Beyond compliance, we have an opportunity to leverage our scale and capabilities in collaboration with others to impact specific issues such as responsible recruitment in seafood and sustainable chemistry in consumables.

    There is no one-size-fits-all approach to addressing social and environmental issues in supply chains. We tailor our engagement by evaluating our sourcing footprint, determining the most relevant issues for each commodity and identifying where Walmart is best positioned to accelerate positive action forward.

    This report describes Walmart’s environmental and social supply chain initiatives in separate sections. In practice, our work in any given product supply chain (e.g., produce, seafood) tends to encompass both.

    Climate change

    Walmart Supercenter store #1560 in Springdale, Arkansas.  Photography for ICM on January 29, 2020.

    Climate change is one of the greatest challenges of our time. According to the U.S. government’s Fourth National Climate Assessment, by the end of the century, warming at the current trajectory will cost the American economy hundreds of billions of dollars from crop damage, lost labor and the consequences of extreme weather.

    As a large omni-channel retailer with hundreds of millions of customers worldwide and a global sourcing footprint, we seek to galvanize collective action to reduce emissions, while taking steps to strengthen the resilience of our business against the effects of climate change.

    Walmart has called for public and private sector engagement in climate action, and we have reaffirmed our own commitment through science-based targets for emissions reduction and Project Gigaton — our initiative for working with suppliers to reduce or avoid 1 gigaton of emissions in our supply chain by 2030.

    Read more about our actions in the Climate change section of this report.

    Challenges

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    Resources

    Challenges to achieving aspirational goals, commitments & targets

    The aspirational goals, commitments and targets we set under priority topics are designed to help Walmart aim high, hold ourselves accountable and move at an aggressive pace. Our public ESG commitments galvanize action across our business through senior-level oversight, policies and programs. We hold ourselves accountable through metrics, measurement and annual reporting, including the annual publication of our ESG Report.

    Our ESG commitments galvanize action across our business

    That said, making progress on ESG issues is challenging. Because success depends on the collective efforts of many, as well as factors such as technical advances, policy changes, economic and price volatility, and supplier engagement, there may be times when we fall short. While we strive in each case to meet our goals and targets, sometimes challenges may delay or block progress.


    Environmental Challenges

    Issue

    Example Challenges

    Climate change

    Public policies that affect supply or cost of renewable energy projects

    Changes to local energy grids

    Weather patterns increasing days requiring facility heating or cooling

    Evolution of refrigeration technology

    Shifts in Walmart asset base or category mix

    Supplier willingness and capacity to implement and measure emissions reductions projects

    Lack of enforcement of laws and regulations

    Innovation in manufacturing or agricultural technologies

    Alignment of scientific community on measurement approaches

    Exacerbation of all of the above due to catastrophic events, including pandemics

    Natural capital

    Complexity of commodity supply chains

    Innovation in manufacturing, agriculture and other product production technologies

    Adoption of supply chain traceability practices and tools (e.g., vessel monitoring and blockchain)

    Pricing and availability of certified products

    Supplier willingness and capacity to adopt sustainable practices

    Financial trade-offs (e.g., cost, capital and revenue)

    Exacerbation of all of the above due to catastrophic events, including pandemics

    Waste

    Data and insights into drivers of waste across the supply chain

    Public policy regarding waste prevention and management

    Quality of recycling and waste management infrastructure in local markets

    Volatility of market for recycled materials (demand, supply and cost)

    Technological innovation in packaging materials and waste management

    Capital and operating cost of implementing waste management technologies

    Alignment of industry around packaging solutions

    Ability to scale waste management processes, tools and behaviors across thousands of facilities in multiple countries

    Materials innovations (e.g., flexible films)

    Exacerbation of all of the above due to catastrophic events, including pandemics


    Social challenges

    Issue

    Example challenges

    Retail opportunity

    Acceptance among retailers of the business case for frontline upskilling

    Engagement of associates in building capabilities relevant for advancement

    Alignment among employers on the importance of building career pathways and credentials that reflect needed skills for advancement

    Evolution of cost-effective, practical tools to rapidly build skills among incumbent workers

    Progress on inclusion in culture at large

    Exacerbation of all of the above due to catastrophic events, including pandemics

    Supply chain: Social sustainability

    Upstream risks beyond the reach of traditional responsible sourcing tools

    Complexity of supply chains

    Diverse responsible sourcing stakeholders with sometimes conflicting expectations

    Emerging trends in country-by-country political landscape

    Scope of international and local laws and regulations

    Greater calls for transparency

    Exacerbation of all of the above due catastrophic events, including pandemics

    Safer, healthier food & other products

    Consumer expectations and demand

    Pace of innovation in product development

    Adoption of transparency labeling among suppliers

    Data availability

    Exacerbation of all of the above due to catastrophic events, including
    pandemics

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